Senate OKs trade pact with Central America

Job loss fears make the plan's fate uncertain in the House

BENNETT ROTH, Copyright 2005 Houston Chronicle Washington Bureau

Published 5:30 am, Friday, July 1, 2005

WASHINGTON - The Senate approved a free trade agreement with Central America on Thursday, but the measure faces an uphill battle in the House, where lawmakers are increasingly balking at trade pacts they contend hurt U.S. industries and workers.

Even in the Senate, which traditionally has been more supportive of free trade, the Central American Free Trade Agreement faced fierce opposition as lawmakers of both parties voiced worries that it would harm the domestic sugar industry and erode labor standards.

A last-minute deal brokered by the Bush administration that would cap sugar imports through 2007 helped convert a few holdouts, leading to a 54-45 vote in favor of the pact.

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Also Thursday, the House Ways and Means Committee approved the CAFTA legislation, which paves the way for the full House to consider the pact later this month.

"The Senate vote helps the prospects in the House," said Rep. Kevin Brady, R-The Woodlands, who is helping to lead the CAFTA effort in the House.

Brady said the Senate approval will help dispel a perception that the trade agreement is dead this year. Nevertheless, he said proponents will be working during the Fourth of July break to alleviate concerns about issues such as textile imports.

Rep. Gene Green, D-Houston, who is helping to lead the Democratic effort against the agreement, said there are not enough votes to approve CAFTA in the House.

Green said 15 of the 20 Democrats who in the past voted for trade pacts and provided winning margins in the GOP-controlled House, are now opposed to CAFTA.

He said those Democrats have soured on free trade in part because concerns about cheap Chinese imports and perception that past agreements, such as the North American Free Trade Agreement have not lived up to economic promises.

"CAFTA is paying for the sins of NAFTA," said Green. Green also said that although the Central American trade agreement would likely benefit the Port of Houston, which is in his district, it would hurt many of his blue-collar constituents, who hold jobs in the chemical and other industries that could be hurt by cheaper imports.

Proponents of the pact said it would bolster fragile democracies and economies in Central America and pave the way for broader free trade agreements in South America.

Sen. John Cornyn, R-Texas, said the agreement would promote economic growth in that region and prevent those countries from becoming targets for dictators such as Cuban leader Fidel Castro.

Sen. Kay Bailey Hutchison, R-Texas, said 80 percent of Central American and Dominican Republic exports enter the United States duty-free, yet the United States pays high tariffs on $15 billion of annual exports to Central America.

"CAFTA rectifies this inconsistency by providing open market access to U.S. goods, services and farm product exports," she said.

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